April Inflation rate for the U.S> expected to make a jump bigger in over a decade

Consumer Price Index (CPI) or inflation rates for the month of April are expected to show the biggest year-over-year jump in over a decade. The expected 3.6% rise in the consumer price index in April is the largest since Sept. 2011. CPI is expected to rise 0.2% month-over-month, as the data gets released on Wednesday. This is in contrast to March’s 0.6% increase, or jump of 2.6% year over year.

The core CPI which doesn’t include energy and food is expected to soar by more than 0.3% or 2.3% year-over-year. The market has already been shaking by the inflation, however the CPI would require extreme consideration if it shows a bigger jump than is anticipated, particularly in the month-over-month periods.

An official stated that he is expecting to witness a surge in used cars prices, as the prices are expected to increase by 70% from what it rates were a year earlier. Also, many economists have been speculating that the April data could provide bigger year-over-year increase after accounting for base effects from previous year when prices had gone down due to the pandemic.

The Fed claims that the rise in inflation will only be temporary. Ana analyst stated that he is expecting CPI year-over-year to reach its highest levels at 3.9% in the month of May before beginning to loose in June. For April, he is anticipating a 3.6% jump.

The CPI report is coming in as market speculations and expectations for inflation rates have been rising. According to another analyst, the inflation rates are expected to average over 2.71% over the next five-year period. The risks are presently to the upside pertaining to these inflation rates.